How to manage joint property ownership after divorce

Family is the most integral part of making a house a home. But unfortunately, divorce has become a harsh reality of society. In modern times, both partners contribute to buy a property. And, thus, when they split, each partner tries to claim ownership of the property. Of all the assets you brought as a pair, the real estate properties call for the most attention.

Between emotional turmoil and social pressure, the division of property can be quite difficult. To claim their respective shares in the property, both parties must provide proof in the form of clear documentation. There can be real confusion over who pays to buy the property. Therefore, each party is required to produce proof about every penny spent on the property. In this article, we have shared some tips on how to manage property ownership when you say it with your partner.

How to divide residential property after divorce?

There are three simple ways in which a couple can divide a real estate asset. They are mentioned below:

· Both parties can rent the property and share the rent equally. It is a good idea if there is speculation that the property price will increase over time. You can continue the rental income until the property rate goes up and you find suitable buyers for it.

· If it is difficult for one spouse to leave the house, the other may rent part of the other party. If the former wife decides to rent it from the husband, it can be adjusted against any alimony allowance made by the husband.

· The third option is that one partner buys the other partner's property by paying in cash. But if there is confusion on the part of each partner in the property, it is better to clarify it first.

If there is a long-term home loan that has to be repaid by each partner, it is best to keep paying EMIs. And, until then, they can rent property and share income.

How to establish your claim after divorce?

· If each partner can present well-written documents proving equity in your claim and assets, the division of assets becomes easier. However, in the case of joint ownership of property, both husband and wife legally will have equal rights over the property.

· However, if a party contributed more money to purchase the property, it can claim a higher stake in the property by furnishing valid documents such as bank statements and EMI payment receipts.

· In India, many husbands decide to register a house in their wife's name to take advantage of reduced stamp duty. In this case, the husband cannot claim his share in the property even though the entire property has been purchased by him. Indian laws on marriage recognize the ownership of homes.

· If the property is jointly owned by the husband and wife, after the divorce, the former wife is entitled to receive 50% of the property, even if she has not contributed towards purchasing the property.

· If a property is owned by the spouse alone, the other partner cannot make any claim on the property acquired themselves if they decide to divorce.

· However, if the wife has contributed to the purchase of the property, but the title deed is only with the husband, then she can claim her share by presenting proof about payment of EMI and other details.

· If the wife has contributed towards the down payment of the property while paying the monthly EMI, the husband can claim ownership if he pays the amount extended by his wife.

Can every real estate be divided after a divorce?

Only property that was brought after marriage can be divided after divorce. Assets acquired by husband or wife as inheritance cannot be divided.

If India, if a woman wants a divorce, she cannot claim rights in her husband's property. However, if the husband wants a divorce, he must pay a regular maintenance fee to his wife or support her by providing the property.

Simple Tips to Buy Earthquake Proof Flat

Earthquakes are considered to be the most dangerous natural disaster that causes mass destruction. In the past, we have seen many countries committing suicide due to this natural disaster as a massive death as well as mass destruction of properties. To protect your family from such devastating situations, you should buy an earthquake resistant apartment or house.

You will be surprised to know that earthquakes are the most vulnerable buildings in our country. In December 2014, the Supreme Court of India passed clear instructions on earthquake safety through a PIL. It states that all multi-storied buildings over five storey's should have an engraved metal plate mentioning the building's anti-earthquake range. But despite this, real estate developers have failed to maintain a high level of transparency in this regard.

Therefore, if you want to buy earthquake-resistant flats, you need to be cautious. In this regard, here, we have shared some useful tips.

Check the location - About 54 percent of the land in India is at high risk of earthquake. The National Center for Seismology has divided the entire country into five zones, namely, zones 1, 2, 3, 4, and 5. While Zone 5 areas are susceptible to high-intensity earthquakes, areas under Zone 1 are the safest. The entire northeastern region, the Himalayan region and the eastern and western parts of India are located in a high seismic zone. Therefore, if you live in these areas, make sure that your house or apartment is designed to withstand earthquakes with a minimum force of 7.

Inspect the structure of the house- Despite the strict provisions by the government for the construction of earthquake resistant houses; most buildings in India do not follow the prescribed techniques for earthquake resistant construction. To find out if your house is earthquake resistant, it is best to hire a civil engineer.

Look for an earthquake-resistant foundation - An anti-earthquake house is one that has a solid foundation. Ideally, the foundation of the building should be raised above the earth to resist ground forces. The foundation must include a bolt. And, the foundation should be built on a flexible pad made of steel, rubber and lead. This ensures that during an earthquake, isolators vibrate while the structure remains stable.

Find out if the house is made of earthquake-resistant material or not — usually houses are made of stacked bricks that are laid with mortar. But such construction does not ensure earthquake protection. Civil engineering experts suggest that the most dangerous structures are constructions with concrete blocks or unconfined bricks. Ideally, if your area is prone to earthquakes, the walls of your house should be made of concrete and wood. And, if your area is at high risk of earthquake, make sure the walls of your future house are reinforced through additional concrete or steel slabs.

Residential vs Commercial Property: Which Should You Choose for Investment?

Residential and commercial properties have certain properties and demerits. Residential properties are used for personal purpose as well as long-term investment, while commercial properties are good for achieving high rental returns. However, they may be more expensive than the former. So, what would be the best for investing and generating high returns? Let us know the answer to this question in this article.

Good rental income: People who believe in investing in real estate always think of generating high returns from it. Commercial properties such as office buildings, warehouses, industrial units and retail spaces are great for making some rental money. Similarly, you can rent your residential property to earn some extra income. It has always been found that commercial properties are always good in terms of making some passive income rather than residential properties, especially during a recession. According to research, you can earn 1-2 percent of rental income through residential properties while commercial property provides you up to 5 percent of rental income. With the increasing development of residential units, the rental market is losing its charm which is reducing the annual profit.

When investing in commercial property it is advisable to examine all aspects such as current leasing environment, clearance, legality and distance from complementary industries. Whereas you should consider some important facts about the residential property that you want to get as its neighborhood, surroundings, and infrastructure and neighborhood property prices. These factors will help you generate a good rental income through investing in the real estate sector.

Risk Factor: Commercial and residential properties that are leased out, asking to tax the income of the property. The risk of investment is always higher in the case of residential properties as they are leased for shorter terms of lease and bring higher maintenance and maintenance costs. Whereas commercial properties provide continuous and long-term rental income. If a commercial property falls under Grade A, there is a possibility that it will generate more rental income than investment in residential properties. Commercial property always gives good rental income on investment unless it is in high demand where operating expenses are at a minimum.

It would be nice if you hire a professional property manager who can help you and help you manage everyday affairs and reduce expenses. However, it can cut down on income from your property. In addition, you will need a larger amount to pay in advance than residential property.

Development Scenario: According to reports, India's first Real Estate Investment Trust (REIT) will give better returns to property buyers and investors, while residential sector will be the first choice of the people. The market was believed to be sluggish, but after the introduction of the Real Estate (Regulation and Development) Act (RERA), and the Goods and Services Tax (GST), the market would again retain its position.

And there will be demand for commercial market after sector for investors. Before making any investment such as its location, size of investment and duration of investment, make sure you go through all aspects of the property.

Hidden facts about Real Estate (Regulation and Development) Act – RERA

The Real Estate (Regulation and Development) Act is fully implemented. The major implications of RERA are summarized below, for the understanding of a person who is not part of the real-estate sector.

Any project up to 500 square meters, and more than 8 units (flats / apartments / personal properties) that are under construction, will have to be registered under RERA.

This means that most, if not all, of the ongoing projects will be officially looked into under RERA.

Every project detail has to be registered. This includes project layout, planning, government approval, land title status, subcontractor of the project and completion schedule with RERA. It has to be presented to the consumer. Each phase of a project will be considered a stand-alone project and will require related permission.

In this way, RERA will be updated with all real estate activity which will help increase transparency and streamline the sector.

Under Section 9 of the Act, all agents and brokers have to register with RERA within three months of the implementation of the Act.

As a result, house buyers will only deal with agents and brokers who are qualified, verified and authorized.

The sale of any project will be on the basis of its original carpet area and not on the super built-up area.

Buyers will get a clear understanding and will be able to make an informed decision when purchasing a property.

Once a particular project is registered and sold, no further changes can be made without the buyer's consent.

This will eliminate the cost of fluctuations after the sale is completed. In addition, it will ensure that projects are delivered on time.

The developers will be liable to pay interest on the amount paid by the buyer if the project takes longer to complete than promised.

This law will ensure that projects are completed and delivered without any delay.

Separate accounts have to be maintained for different projects of the same developer. 70% of the client's money will be used to build related projects.

This will help in regulating the transaction. The customer's money will be used fairly and appropriately for the development of their homes. It will also assist in timely delivery of projects.

In case of any damage, the customer can contact the developer in writing within 5 years of being taken possession.

This will ensure the safety of the customer even after they are assigned to the project.

Under this Act, the Real Estate Appellate Tribunal is constituted. These tribunals will decide on disputes between buyers and developers within a time limit of 60 days.

This will speed up the resolution process.

For the developer who fails to follow the law, the maximum is 3 years without jail / fine.

Therefore, the law will have to be strictly followed for everyone in the industry, making it customer-friendly.

How to save tax from your real estate investment?

Buying a property is the biggest purchase or investment that most people make in their lifetime and the government realizes this. The government has allowed income tax deduction if the property is purchased on loan. The borrower can claim deduction from 1.5 lakh to 2 lakh under the Income Tax Act on home loans. Entire interest can be deducted directly from income if the property is not occupied by the borrower. These above conditions apply even if the money is from friends, family or private sellers.

There is a problem with the current market situation, as projects are delayed in completion. This in turn causes problems for borrowers. If their house is not fully constructed then the borrowers cannot deduct any interest. A buyer, on the other hand, receives the benefit of the principal amount. Upon possession, the borrower of the property can claim a deduction for the interest paid during the pre-construction period. To take advantage of the current scenario, a couple must take out a joint loan that allows each to claim a full tax deduction for both principle and interest. This also applies to children and parents.

If the borrower has only one house and is self-occupied, there is no taxation in this case, but if there are more houses and it is neither exempt nor occupied, then taxation here can be a bit complicated.  In such a case, the owner should get the national rent value and pay tax on it. An appropriate method is followed to calculate the national price, taking into account the value of the municipal property and the Rent Control Act or the ongoing rental rates of the locality.

If a person is trying to claim a housing loan deduction and Housing Rent Allowance (HRA) at the same time, it causes trouble. Many claim HRAs because they have a home in a different city and live in a different city. The department allows you to claim an HRA in the same city with real reasons, such as if you have a suburb in the city and your office in the city. When calculating the national value of your second home, you can deduct some taxes like municipal taxes and also 30 percent of the value for repairs and maintenance.

When it is time to sell the acquired property, the tax paid is calculated on the profit generated. If it is sold within three years of acquisition, the seller is required to pay Short Turn Capital Gains (STCG) and the time period is more than three years, they are required to pay Long Turn Capital Gains (LTCG) requires surcharge which is more than about 20 percent. If one buys a new asset equal to the long-term capital gain within one year before the date of sale, the entire tax outgo can be saved. This property is under construction. The time period is three years. While calculating STCG and LTCG tax, one can deduct money on corrections and also to acquire assets such as payment of stamp duty, legal fees and brokerage.